When you buy a home, you are provided the title to the property. That title gives you legal ownership that is based on the specific type of title you receive. In some situations, there is a mistake in the title that can affect your rights to a property. It could even mean that someone else has legal rights to your real estate.
Title insurance provides you with some protection if this type of defect is found. As part of getting title insurance, a title company will do a background investigation on the title, but that investigation is not nearly as extensive (or often accurate) as when a real estate attorney does the same type of search. There are also many other benefits of using a real estate attorney instead of a title company.
A title company can never give you legal advice. You may be able to get information from a title company, but they won’t be able to tell you what to do with that information. A real estate attorney can handle a title defect, what certain information contained in your title means, and more. They can also often correct issues in a title for you, which a title company may not do.
A title company has no motivation to protect you or address your interests. On the other hand, the title insurer has a self-interest in decreasing the risk of title defects. However, if they spot a title defect, they may simply increase the premiums instead of addressing the problem in the hopes that the issue will never rear its ugly head. Your real estate attorney works for you. He or she will represent you throughout the sale process and will address problems rather than charge you more to hide from them.
The lawyer provides assistance with the title, but he also looks over paperwork, engages in negotiations, and generally looks out for the best interests of their client. A title company merely prepares the documents required by the insurer. The insurer is only helpful if something goes wrong with the title down the road; it does not provide any assistance in the sale process.
In many cases, a title insurance company and an attorney will have comparable costs. However, the attorney is doing double duty. He or she will act as both a title agent and a real estate attorney, which means you get more for your money.
The team at Bergstein Flynn & Knowlton PLLC would love to help you through your real estate transaction. We can help with title issues and a lot more. Please contact us for more information.